On the Comex division of the New York Mercantile Exchange, gold futures for August delivery in after hours trade exchanged hands for $1,319.10 an ounce, up slightly from Monday's trading session but off its highs for the day of $1,326.

Tuesday's trading was quiet again with only some 115,000 contracts changing hands. This compared to Thursday last week when after months of subdued trade on gold futures markets volumes surged and gold jumped nearly $50.

Last weeks rally was ascribed to dovish comments comments by Federal Reserve chair Janet Yellen that US interest rates would be lower for longer and the escalating situation in Iraq.

Those two factors are very much still in play but gold's recent price performance has not convinced most market analysts that a rerating is in order.

Prices will average $1,250 an ounce in the third quarter a decline of more than 5% from current level, according to the median of 15 estimates by Bloomberg.

The analysts were surveyed before and after the US central bank's June 18 outlook, but predictions were not altered:

"The surge in gold can’t sustain itself," Donald Selkin, who helps manage about $3 billion of assets as chief market strategist at National Securities Corp. in New York, said June 20. "It was a temporary spike because of a confluence of events: Iraq and Yellen. People will be looking at other areas for excitement. Holdings are down, so people are leaving gold in search of something better."

A new note by Barclays concurs with these sentiments adding that "any price level above $1,300 per ounce must be viewed as opportunity to sell gold," reports Hard Assets because of expectations of stronger US economic numbers and employment:

"Any upside for jobs growth would imply further downside for gold. Moreover, analysts predict a broad-based US dollar rally in the near term, which again would weaken the gold’s prospects."

Gold is up 10% so far this year after 2013's dismal 28% drop, the worst performance in more than three decades for the metal.

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